The Role of Islamic Microfinance Institutions in Alleviating Poverty in Bauchi State, Nigeria
The main objectives of microfinance schemes to alleviate poverty and to enable the poor to empower themselves are in line with the Islamic economic principles of justice. However, the conventional microfinance schemes and operations based on interest (riba) are prohibited in Islam and thus, cannot be used by and for the Muslims. Hence, various Islamic financing schemes offered by Islamic Microfinance banks have the salient features and characteristics that can contribute towards a more ethical economic and financial development of the poor and micro entrepreneurs. The aim of this study is to examine the views of both the management and the clients of Tijarah Microfinance Bank; Bauchi, Nigeria on its role in alleviating poverty and to find out whether there is significance difference between the views of the two categories of respondents. The population of the study consists of all the clients and the management staff of Tijarah Microfinance Bank Limited, Bauchi. There are eleven (11) staff and 123 clients of the bank in all the 20 local governments of the state. The sample size of the study comprised of all the 11 staff and 80 clients of Tijarah Microfinance Bank, Bauchi. The sampling technique used in this study was the purposive sampling technique. The data for the study was collected through the use of structured questionnaire which was analyzed using descriptive statistics, chi-square and independent sample tests. The study reveals that both the clients and the staff of Tijarah Microfinance bank are of the opinion that Islamic microfinance bank has the potential of alleviating poverty in Bauchi State and that there is significant difference between the perceptions of the two categories of respondents on the potential of Islamic Microfinance bank in poverty alleviation. The study recommended that Islamic Microfinance banks should properly educate the clients about Islamic financing, its implementation according to Shariah and its proper use for productive proposes by developing a good information system using good visuals and professionally presented seminars, banners and arranging regular sessions with the business community.
Islamic Microfinance, Shariah, Poverty, Bauchi, Nigeria
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